AnaCap sells Cabot to JC Flowers

Ellie Pullen
15 May 2013

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AnaCap Financial Partners has sold Cabot Credit Management (CCM) to JC Flowers in a secondary buyout worth a reported ТЃ800m.

According to reports, the sale has given CCM an enterprise value of £800m, including debt, and has doubled AnaCap's original investment.

CCM was formed in 2011 from two of AnaCap's portfolio companies, Cabot Financial Holdings and Apex Credit Management. AnaCap acquired Apex in a debt-free management buy-in in 2007, which saw AnaCap appoint Neil Clyne as Apex's new CEO.

AnaCap acquired Cabot Financial in a secondary buyout from Citi in 2011, alongside Morgan Stanley and Partners Group. Anacap bought the company via its AnaCap Financial Partners II fund, which held its final close in May 2009 on €575m. The vehicle typically makes investments of €40-150m in mid-market financial services companies in Europe.

The merger formed the UK's largest debt purchasing and collection business, according to unquote" data.

CCM issued a £265m senior secured note last September, which matures in 2019 and has a 10.4% coupon. Some of the proceeds from the high-yield bond offering were used to refinance existing debt.

Recent UK investments by JC Flowers include a £65m early-stage investment in London-based retail mortgage provider Castle Trust last October, and a reported £50m expansion deal in Kent Reliance Building Society in 2010.

Company
CCM was formed in 2011 and is headquartered in Kings Hill, Kent, with additional offices in Stratford-upon-Avon and Dublin. The company employs 700 staff.

CCM acquires and manages consumer debt. The company is divided into four branches: Cabot Financial, Cabot Financial Ireland, Apex Credit Management and Apex Discovery Solutions. The group specialises in debt purchase, contingency collections and customer tracing.

CCM currently holds £7.7bn in assets under management. The company recorded revenues of £161m in the year ending on December 2012, as well as an EBITDA of £111m, equating to a substantial profit margin of 69%.

People
Neil Clyne is the CEO of CCM and Glen Crawford is the company's managing director. J Christopher Flowers is chairman of JC Flowers & Co. Joe Giannamore and Peter Cartwright are co-managing partners at AnaCap.